A few doors down from the sheriff's office in Mountain Home, Ark., is a bakery and cafe whose almond Danish comes piping hot from the oven every morning.

Voted the best lunch and pastry goods in this Ozark Mountain retirement community, the bakery is owned by Lisa and Mark McMahon, formerly of Salinas. According to the United States Attorney's Office, it was purchased in part with money stolen from the Monterey Bay Aquarium Research Institute.

Lisa McMahon, 51, is scheduled to make her first appearance in U.S. District Court in San Jose this week on an indictment alleging she embezzled $800,000 over a seven-year period while working as MBARI's payroll specialist. If convicted on three counts each of interstate wire fraud and theft from a federally funded program, the cake baker could face up to 90 years in prison and fines of more than $1 million, though with her clean criminal record, her penalty would likely be much less.

It seems an unlikely turn of events for a woman trusted with the finances of one of Monterey County's premier research facilities for more than a decade. She was so valued at MBARI, officials there let her keep her job and telecommute after she and her family moved to Mountain Home to be near her mother in 2007.

MBARI spokesman Kim Fulton-Bennett said the facility usually frowns on the practice, preferring the professional communication fostered when its employees are onsite.

In fact, MBARI President Chris Scholin said, he was re-examining the facility's work-from-home policy, and preparing to eliminate the practice altogether in the spring of 2012 when McMahon resigned in good standing from the lab, ostensibly to focus on the 8th Street Cafe and Bakery in Mountain Home.

It wasn't until July 2012 that Scholin learned that McMahon may not have left with such an unclouded record. According to the indictment handed down May 30, an outside audit revealed an irregular loan payment to McMahon's 401k account from an MBARI account.

MBARI employees were allowed to borrow money from their tax-deferred accounts. Loans were paid back through payroll deductions managed by McMahon.

A three-month internal investigation uncovered many more "salary enhancements that were very cleverly disguised and booked as expenses that became so diluted they were really hard to trace," Scholin said. The authorities were notified.

The FBI and Monterey County Sheriff's Office conducted an eight-month investigation that ended with a grand jury handing down the six-count indictment.

In all that time, according to her family members, McMahon was never interviewed. But for a letter she received last year, her sister-in-law said, McMahon would not have known there was an investigation.

Until Friday night. That's when she learned from a local radio station that she'd been indicted, said her daughter.

Danielle McMahon said her mother was so distraught over the news she had to be taken from the restaurant and medicated. As of Monday afternoon, McMahon had still not received formal notification of a court date.

Assistant U.S. Attorney Philip Guentert said he spoke with an attorney representing McMahon on Monday and confirmed her first appearance is scheduled for Thursday at 10:30 a.m. in U.S. District Court in San Jose. A no-bail arrest warrant awaits her if she fails to appear.

Jean Elsa, McMahon's sister-in-law, said transportation would be difficult. Mark McMahon cannot fly, she said, and it's a 32-hour drive from Arkansas. The couple left Monday evening.

While Lisa McMahon did not return calls over the weekend, her daughter said the allegations are "completely false." If her mom stole $800,000, she asked, where did it go?

The family lost its Salinas home to foreclosure after the McMahons took out a loan to finance the move to Mountain Home, an idyllic spot regularly named one of the top retirement and fishing locales in the country. Investors financed the bakery and cafe, she said, and the family was about to lose that, too.

Indeed, public records show a history of financial woes for the McMahons. Tax liens and civil judgments in Arkansas alone mount to more than $17,000. If McMahon is convicted, according to the indictment, the government will also seek forfeiture of all property derived from the proceeds of the alleged crime.

The allegations have not impacted MBARI financially, Scholin said. There was insurance to cover the loss and its federal grants — averaging $5.4 million to $8.4 million a year, according to the indictment — are secure. But they have impacted the staff.

"We all appreciate having this job and opportunity," said Scholin. "It's a privilege to work here and a responsibility and you don't take that for granted.

"We're like a family and to have someone you thought you could trust ... be accused, was very shocking to the staff," he said. "It made people more diligent in thinking about what they do and what people around them are doing."

And, he said, "it's all hearsay until a court of law decides the case."